"Flying Cars" Are Part of China’s Economic Growth.

China is targeting a new economic growth driver by opening up the skies to drones and helicopters.

Phoenix Wings drone takes off from a platform floating off Shanghai’s coast and zooms out to sea, it will return with a cargo hold full of fresh seafood. The flights to islands 130 kilometers away have cut what used to be an overnight ferry journey down to three hours, meaning fish that previously had to be frozen can now reach restaurants with more of their flavor intact.

Drone deliveries are a small slice of a nearly hundred-billion-dollar market taking off in China based on new aviation technology — also including small planes and helicopters - which is getting serious support from the central authorities.

China’s government wants what it calls the "low-altitude economy" - comprising commercial flights below 1000 meters, in most cases — to become a new driver of consumer spending on services as traditional sectors like real estate struggle.

Thanks to loosening airspace restrictions, a growing number of Chinese companies are offering sightseeing and business trips in helicopters and small planes. Domestically-made drones spray crops with pesticides, take wedding photos, and hunt for mineral deposits.

The next step? After becoming world leaders in electric cars, Chinese companies are pioneering the development of electric flying vehicles.

China’s aviation regulator last year released guidelines designating airspace under 300 meters: smaller drones would be permitted to fly with fewer restrictions, except in areas near airports. That’s helping drive a boom in use of the craft - there were nearly 200000 valid drone pilot licenses in China as of 2023, according to official statistics. Many are used in the countryside to spray pesticides and fertilizers, where the busiest drone pilots can earn over US$42800 a year.

China has the world’s largest e-commerce sector, and according to SF Express, about 1% of China’s annual volume of 100 billion packages could be suitable for drone transport, requiring approximately 100 million flights.

In August 2024, tech giant Meituan launched drone delivery services providing tourists in Beijing with food, heat-relief products, and emergency supplies at a section of the Great Wall. The city’s government wants to host 5000 low-altitude aviation companies in the next three years.

For now, the focus is on reducing costs. This will allow consumers to enjoy the service at a lower price.

Chinese companies are rushing to develop electric vertical take-off and landing (eVTOL) aircraft for their potential to transport both passengers and cargo more sustainably, cheaply, and quietly than gas-guzzling helicopters. Thanks to lower costs, they could become an everyday mode of transport on par with cars.

Resembling a large drone with an added cockpit, eVTOLs take advantage of Chinese companies’ leadership in the technologies powering both drones and batteries. The difference between helicopters and eVTOL is similar to that between fuel cars and electric cars.

Despite being widely referred to as "flying electric cars", the application scenarios of eVTOL could be entirely new. It will undoubtedly bring about a more profound revolution in the industry. Compared to traditional fuel helicopters, the vehicles can achieve 60% energy savings, 90% emission reduction, and 65% noise reduction, according to research by China Post Securities, a brokerage firm.

China’s eVTOL boom is centered in Guangdong, the tech-rich province bordering Hong Kong that includes China’s "drone capital" Shenzhen — home to industry leader DJI — where the local government has been supporting test flights.

Prosperity, an aircraft developed by Chinese company AutoFlight became the first eVTOL to complete a cross-sea intercity flight between Shenzhen and Zhuhai, 70 kilometers southwest. The uncrewed flight covered a journey that would typically take two hours by car in 20 minutes. The ticket price was set at around 300 yuan (US$42) per seat, significantly cheaper than a typical urban helicopter flight.

EHang, another startup based in Guangdong, last year became the first company to receive an airworthiness certificate from China’s aviation administration for an autonomous two passenger eVTOL. The company revealed it has overseas pre-orders for more than 1200 units and predicts that on-demand air taxis will be a common sight in about five years.

Technical challenges remain: eVTOL batteries need much higher energy density for longer and more demanding trips than cars.

Concerns about safety mean that years of tests will be needed before widespread commercialization. While the first experiments in regular commercial eVTOL use are scheduled for 2025, large-scale commercial applications aren’t expected to be commonplace until 2035, according to official guidelines on eco-friendly aviation manufacturing published last year.

Xpeng Aeroht, the self-described "flying car" subsidiary of Xpeng, aims to begin mass production and deliveries of an eVTOL in 2026, selling for a maximum of 2 million yuan, the company announced this month. Its first public manned flight is set for the Zhuhai airshow in November 2024.